In your 20’s, the concept of retirement can be one that’s difficult to grapple with. How can you focus on saving for a future when even just 3 years from where you are today seems a vast distance? I’ve talked before about the struggle I’ve faced with the illusion of retirement to reality. Even with that push-pull thought process, I want to create a place that encourages the savers of today to get their game plan ready for a glorified retirement in the future. Sometimes some of the best ways to break down a complex idea is to find things in life that are analogous to the theory. Today, I’m bringing forward the game of golf & what may happen along the way as you’re gearing up for your retirement (for the sake of shortness, we’re sticking to 9 holes and not 18).
You look down the fairway and see that yellow waving flag in the distance. That waving flag signifies the destination of retirement. It’s a par 3 and you’re feeling the pressure because it’s over 200 yards to get to the hole. How in the heck are you going to get there when it seems like your shots at the range have been falling short every time? But you’ve got a great support group with you, and clubs in your golf bag to help you get there. You feel encouraged, and you’ve been preparing to take on this course. You tee up by setting up your first account to get to some retirement saving (whether it be a 401k, IRA, or other investment vehicle).
Just getting warmed up as you make your way along the course. Hole 2 is kind of like the first couple years of investing and saving for retirement. It’s a new playing field – investing that is, and you’re not quite sure what to expect along the way. For the first couple of years the stock market may be doing well, while the following year it may be quite volatile. You get a feel for the course, and start selecting the different clubs/tools necessary to get you further along the fairway (how should I diversify? how can I get the right mix of stocks, bonds and cash?).
You’ve somehow managed to land yourself in a sand trap. Sometimes while saving for retirement, you may face some unexpected setbacks. Even though you’ve landed in the sand trap/setback, you still have the opportunity to make your way to the end goal – it doesn’t matter how many strokes it may take. Perseverance and patience are absolutely key. Most of setting aside money for retirement is a mental game, and not about the actual numbers game. Grab your sand wedge, plant your feet in the sand for that shot, and hit it right up close to the hole. The best part? You get to erase your foot prints in the sand with the rake, just like how you can brush away any setbacks of saving you may have faced and move on. The rest of the course is waiting.
Someone shots “fore!” as you contemplate ducking for cover. There will be distractions preparing for retirement along the way, but don’t let them get to your head (literally & figuratively). Although the unexpected may occur, it doesn’t mean you’re going to pack up and leave the course. You’ve still got 5 more holes (or several years in terms of investing) left to play the game! Many moments of triumph, and potential pitfalls can occur along those next few holes/years.
You just managed to get a birdie (1 under par for the hole)! You’re staring to feel that high as your asset classes and investment choices are experiencing great returns. You recognize that you have a lot of time left in this game, and decide to adjust your strategy to take on more risk. More time in the market allows for more time to make great returns. You decide to weight your portfolio heavily in stocks and ride out the course and market with determination.
Well shoot…you’re ball just landed in the lake and you face a penalty. It seems you’re portfolio is down, but you attempt to avoid looking at the scorecard too in depth until you reach the end of the game. Historically, the market will always bounce back and gain even more returns than what happened prior. So before you get down about the fact that an alligator potentially swallowed your ball (“give the ball, alligator!”), you know there is still time to make gains on even the most challenging parts experienced of your game.
Unreal, you just got a hole in one (this is a goal of mine, and I’m sure for many too – if you’ve gotten a hole in one before, you better leave me a comment below letting me know all the glorious details)! It’s been several years of preparing for retirement, and you’re completely on track with your goals. Maybe even better than you anticipated. All those years of focus and savings are preparing you for hole in one euphoric feelings such as this.
You’re nearing closer to retirement, and suddenly you get a bit more of an energy kick. You decide to tone down your strategy to be a bit more conservative for this last hole/couple of years. Slow and steady will get you to where you need to be. The hyper focus is real as you prepare to embark on this new journey of retirement in your life. Time to finish this game!
The last flag you will take a look at for the day. Are you ready to finish the game of retirement savings on what you’ve been working towards? All the goals, strategies, support, savings, investments and tools combined have allowed you to qualify for this moment. Maintain your focus, and the strokes will get you there. Then you can pull out that scorecard and observe all the weak spots and greatness that allowed you to officially retire. It doesn’t take perfection to accomplish your goals for retirement (just check out how you had 7 strokes on one hole, but managed to get 2 under par on another). The course can seem long, and the game of saving along the way can be full of potential mishaps and surprises. It’s up to you to put your mental focus front and center to accomplish the savings you want for retirement.
Do you think the game of golf is like saving for retirement? What sports come to mind that are analogous to retirement saving? Have you ever gotten a hole in one before? Let’s begin the conversation!